Insurers Balk at Legislation That Would Make Them Pay for Safer Painkillers

But deal may be reached to lower patients’ out-of-pocket costs for some of the newer abuse-deterrent opioids

New types of opioid drugs can actually help deter abuse – some are being made more difficult to crush to be injected or snorted, some contain other drugs that help block the addictive effects, and some are absorbed more slowly into the body – but the new drugs are expensive, and insurers require patients to pay more for them.

That’s why Assemblyman Herb Conaway Jr. (D-Burlington) has proposed a bill, A-4271, that would require insurers to include abuse-deterrent opioids in their least expensive class – or tier – of prescriptions.

Advocates for the insurance industry argue, however, that it will add to the cost of covering drugs, raising overall health costs for patients and employers.

Conaway said he wants to give doctors more tools to treat patients with chronic pain while lowering the risk of addiction. The bill would save lives, he said, adding that doctors are unfairly singled out for prescribing opioids that are being abused by patients with chronic pain.

New Jersey isn’t alone in facing the issue. A recent national study by consulting firm Avalere Health found that Medicare drug plans tend to favor less-expensive generic drugs that lack abuse deterrence over name-brand drugs that include it.

The proposed bill is in addition to a large package of bills that has been advancing through the Legislature over the past nine months, several of which Gov. Chris Christie has already signed.

A spike in the number of drug-overdose deaths made dealing with the issue more urgent.

Sarah Adelman, vice president of the New Jersey Association of Health Plans, said insurers share legislators’ concern over prescription opioid abuse, but oppose the bill.

Insurers negotiate with pharmaceutical companies to include specific drugs at the least-expensive tier of prescriptions, promising higher volumes of drugs in return for lower costs, Adelman noted.

By requiring that all abuse-deterrent drugs be included in the least-expensive tier, the bill would eliminate the incentive for drug makers to negotiate for these higher volumes, Adelman said. While patients would no longer see higher out-of-pocket costs for the abuse-deterrent drugs, there would be higher “back-end” costs priced into monthly insurance premiums as a result, she said.

Adelman noted that a similar measure in Tennessee added an estimated $11 million to that state’s insurance costs, while legislation in California had an estimated cost of $8 million.

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Conaway took the example of California, noted that New Jersey is roughly one-quarter its size, and arrived at a rough estimate that the bill would cost New Jersey $2 million.

“I think this is one of these situations where you come back and say, ‘What is the cost of someone’s life?’ ” Conaway said.

There appears to be room for a compromise that’s more favorable to insurers. Adelman suggested that the state could require insurers to include at least one or two abuse-deterrent opioids in the lowest-priced tier, rather than all of them. Then, insurers could continue to negotiate lower costs for these favored drugs.

The Assembly Health and Senior Services Committee released the bill earlier this month in a bipartisan, 9-0 vote, although Assemblyman Erik Peterson (Hunterdon, Somerset, and Warren) abstained, urging Conaway to work with insurers to amend the measure based on Adelman’s suggestion. A Senate version of the bill hasn’t been introduced.